The Company's constitution provides that:

• The minimum number of directors shall be 3 and the maximum number of directors shall be 10 unless amended by a resolution passed at a general meeting.
• At each annual general meeting, at least two directors must retire from office. Re-appointment is not automatic. If retiring directors wish to continue to hold office, they must submit themselves to re-election by shareholders.
• No director may be in office for longer than 3 years without facing re-election.

Independence

The concept of independence in the context of directors is variously defined. The Board has considered each of the 8 directors in office at the date of this report and determined that four of them are independent. The four directors who are not considered independent are Mr Christopher Morris and Ms Penelope Maclagan who are each executive directors, Mr Anthony Wales who is a substantial shareholder and a former executive director and Mr Bill Ford who is associated with a substantial shareholder.

Of the four independent directors, none has previously been an employee of the Group and the Board believes that none has any relationship that could materially interfere with the exercise of their independent judgment.

No directors participate in share, share option or performance based plans. Non-executive directors receive only cash compensation and reimbursement of expenses for their services.

BOARD COMMITTEES

It is the Board's policy that committees dealing with corporate governance matters should be chaired by a non-executive director and have at least a majority of members being non-executive directors. Any director or committee of the Board is entitled to obtain independent professional or other advice at the Company's cost, unless the Board determines otherwise, and is entitled to obtain such resources and information from the Company, including direct access to employees of and advisers to the Company, as they may require.

Three Board Committees have been established to assist the Board in discharging its responsibilities as follows:

The Risk and Audit Committee

The principal functions of the Risk and Audit Committee include reviewing and making recommendations to the Board and assisting it in the discharge of its responsibilities relating to accounting policy and disclosure. It is responsible for assessing the adequacy of accounting, financial and operating controls, reviewing the performance of external auditors and examining their evaluation of internal controls and management's response.